The Tokyo District Court has reportedly moved the infamous Mt Gox case out of criminal bankruptcy into civil rehabilitation, meaning creditors will likely be paid in BTC in mid-2019, and that the exchange’s trustee won’t likely sell funds anytime soon.
According to a document published on Mt Gox’s website , the process is set to start early next year, and is mostly good for the cryptocurrency ecosystem. Mt Gox was notably a dominant cryptocurrency exchange that collapsed in 2014 amid claims of insolvency and security breaches.
At the time, hundreds of millions of dollars worth of BTC were lost, which saw the cryptocurrency’s price to crash. Recovery efforts managed to find 200,000 BTC, which were then held by the exchange’s trustee, Nobuaki Kobayashi.
Had the cryptocurrency exchange’s case remained in criminal bankruptcy, creditors would have been paid back in fiat currency, equivalent to bitcoin’s exchange rate at the time Mt Gox went down – less than $500 per coin.
Since 2014, bitcoin has appreciated to over $6,100 . The exchange’s former CEO Mark Karpeles, who was charged with embezzlement and data manipulation, would’ve received most of the remaining proceeds.
Karpeles, as CryptoGlobe covered, has statedhe doesn’t want said funds , which amount to about $1 billion. At the time, he said he never expected to received anything from the bankruptcy, and that it is an “aberration” that it was a possibility, adding that he believes it is his responsibility to make sure it doesn’t happen.
Given that the case was moved to civil rehabilitation, Kobayashi is set not to sell any more bitcoin until creditors are reimbursed next year. As for cryptocurrencies created through bitcoin’s various forks – including BCH, BTG, and BCD – the document states:
At present, nothing has been determined regarding the sale of Bitcoin and cryptocurrencies split from Bitcoin (collectively, “Bitcoin, etc.”) in the future.
How creditors will be reimbursed isn’t yet clear, and will likely be determined in subsequent legal proceedings. Mt Gox’s creditors will be required to refile proof of claim forms by October 22, 2018. This applies to all creditors, even those who didn’t manage to participate in the proceedings last time.
Currently, wallets associated with Mt Gox still hold 137,890 BTC, worth nearly $880 million, along with these airdropped tokens. As Bloomberg reporter Yuji Nakamura puts its, a distribution of these funds could trigger a major sell-off next year.